THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

JOHN KING, HOST: Breaking news tonight from the Pentagon. It says gay and lesbian Americans are now free to enlist in the armed forces and to be open about their sexuality as they do so, but leading gay rights organizations warn of the risks because the "don't ask, don't tell" debate is still making its way through the courts. We'll ask a senior White House official if he agrees.

And it's a busy day on the campaign trail. Out west, keeping Patty Murray's seat in Washington State is a critical part of the Democrats' so-called firewall strategy to protect their Senate majority. Fired up is what you might call Vice President Biden just a few hours ago as he made the case for Murray and against the Republicans.

(BEGIN VIDEO CLIP)

JOSEPH BIDEN, (D-DE) VICE PRESIDENT OF THE UNITED STATES: Ladies and gentlemen, these guys talking about the deficit is like making an arsonist the fire marshal. They have zero credibility. They wouldn't know a balanced budget if they saw one.

(END VIDEO CLIP)

KING: The Tea Party candidates running from coast to coast call themselves constitutional conservatives, but in a Delaware Senate debate today, Tea Party candidate Christine O'Donnell conceded she knew some of the major amendments but not others.

(BEGIN VIDEO CLIP)

CHRISTINE O'DONNELL (R), DELAWARE SEN. CANDIDATE: Where in the Constitution is the (INAUDIBLE) church and state?

UNIDENTIFIED MALE: It's an -- no an excellent point.

(CROSSTALK)

UNIDENTIFIED MALE: Hold on, hold on. Please, please.

(END VIDEO CLIP)

KING: And former President Bill Clinton is on the trail again. This time in Florida, trying to help underdog Senate candidate Kendrick Meek and worrying out loud that he sees the potential for a big Republican tide just like in his first midterm election. (BEGIN VIDEO CLIP)

BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES: There is always a gap between the time when you start doing the right things and the time people can feel it. That's what I tell you. I've seen this movie before in 1994.

(END VIDEO CLIP)

KING: Is he right? And why is Mr. Clinton so loyal to the struggling Meek two weeks to Election Day? We'll map out the balance of power and check in on the biggest races.

Politics in a moment but first the breaking news tonight from the Pentagon. In a sea change to the U.S. military's recruiting policy the Pentagon is advising recruiters they now can accept openly gay and lesbian recruits, but groups that represent gays are warning both recruits and current service members anything you say now could be used against you later. Let's get the latest from CNN Pentagon correspondent Chris Lawrence -- Chris.

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Yes, John. What the Pentagon is basically telling all of its recruiters is, look, if a candidate walks into your office and says that they are gay or lesbian or you know them to be gay or lesbian, it's OK as long as they pass all of the normal qualifications. You've got to keep processing their application. That's the big difference.

But they're also telling the recruiters you've got to manage these candidates' expectations. And you've got to let them know that even though right now "don't ask, don't tell" is not the law of the land, it's expected that the federal government is going to appeal the recent judge's decision that made it so and so "don't ask, don't tell" could, in fact, come back into effect.

It's got the very unique position of the -- the Obama administration legally fighting to keep a policy that it has gone on record as saying eventually it wants to get rid of.

KING: Important and confusing all at the same time. Chris Lawrence with the breaking news tonight at the Pentagon -- Chris, thanks.

Let's talk about the political impact of this, but first a bit more on the policy. Among those taking advantage of the new decision today was a high-profile veteran who has championed the rights of gay Americans to serve. National Guard Army Lieutenant General -- Army Lieutenant -- I'm sorry Dan Choi reenlisted today. He said this was a great day as he did that.

But others are warning against such a move. Here's a statement from the Service Members Legal Defense Network. "During this interim period of uncertainty, service members must not come out and recruits should use caution if choosing to sign up. The bottom line, if you come out now, it can be used against you in the future by the Pentagon." I put that question, is this too risky, to the senior presidential adviser David Axelrod?

(BEGIN VIDEO CLIP)

DAVID AXELROD, SENIOR WHITE HOUSE ADVISER: There is uncertainty about the court case, and so that is a cautionary note that people should -- should feel. But the one thing that I will tell you, John, is this president has made a commitment and it's not a question of whether that program, whether that policy will change but -- but when. We're at the end of a process with the Pentagon to make that transition and we're going to see it through.

Cornell to you first -- I remember this from 1994. This was one of the issues that undermined Bill Clinton in his first midterm election. Has the country changed, has public opinion changed or is having this come front and center two weeks before a midterm election potentially damaging to this Democratic president?

CORNELL BELCHER, DEMOCRATIC POLLSTER: Well first -- well first this as a pollster, not as a Democrat. One of the things interesting is if you look back over the changing data that you see coming out is that it is a slow tide of change of aggression. I remember you know one of the groups that adamantly sort of against gay rights has been African-Americans and when I look back I put a question on a poll a couple of months ago about sort of gays in the military.

And you know what (INAUDIBLE) African-Americans for that, so I think the times are changing. Now, as a Democrat, if Republicans want to stop talking about the economy and talk about whether it's a good idea that a gay man can strap on a gun and go kill for his country, I'll take that.

ROLAND MARTIN, CNN POLITICAL CONTRIBUTOR: But, John, the problem, though, for Democrats is this is not the conversation you want to have. We've seen Democrats have an issue for the past two months with messaging. So now all of a sudden if you're a Democratic candidate, if you're one of these conservative or moderate Democrats in a southern state or if you're really on the line there, do you really want the questions now from reporters in various debates, from people out there from various voters saying, hey, what is your position on this? All of a sudden that's the last thing you want to talk about. That's why this (INAUDIBLE) help Democrats running right now.

KING: But potentially confusing to candidates. And Ed Rollins, as a former White House political director, you're a Republican, of course, but as a White House political director, how do you handle something like this because frankly I'm pretty confused. The one -- there's a case pending in the court. We could get a ruling from a judge tonight who has essentially said this policy is wrong and gay and lesbian Americans should be allowed to serve openly, but that's one judge. The Congress has to change the law for this to be finally settled. And Congress at the moment has said it's not willing to do that.

We'll see what happens when they come back after the election. So you have the administration saying, go ahead, be open, enlist if you want, but warning at the same time, however, the legal ground beneath you could change.

ED ROLLINS, CNN POLITICAL CONTRIBUTOR: Well, the problem here is the president is being very inconsistent. He can order his Pentagon to basically not take recruits in at this point in time until the thing is clear. But instead, he's ordered them to go ahead and live with the -- with the one federal judge. I think at the end of the day, it's his Justice Department that's going to try and overturn this.

And I think to a certain extent, if this president wants this, he ought to go make it happen. He ought to be out front to his community that's very important, the gay community, and make this thing happen. At the end of the day, this will end up in the Supreme Court. My sense is that just as gay and lesbians have fought for this country for many, many years, they will have the right to do that in the foreseeable future. And the quicker you eliminate this confusion, the better we all are.

(CROSSTALK)

MARTIN: John, (INAUDIBLE) explain why are they appealing it? I mean it's very difficult when the president says I want to see this changed but the DOJ will appeal the ruling. You need to explain to people why you're -- why you're appealing because it really doesn't make much sense to me.

KING: But if he explains it to people, especially two weeks before an election, is he not potentially picking a fight with his own base that says why are you supporting Bush administration anti-terror policies in the courts? Why are you defending these policies we opposed in the courts?

The administration does have a tough job -- you're absolutely right -- in the continuity of government and defending the administration's power and prerogatives. However political this is dicey.

BELCHER: But (INAUDIBLE) for it, you know you don't want to have this conversation, but (INAUDIBLE) for it is to say, you know what, this is a process that's got to go through the courts. And truth of the matter is it is a process that has to go through the courts. Like Ed said, it will end up in the Supreme Court. And you know what; this is going to be overturned because you cannot stop the progress.

MARTIN: But you've got to explain to your base though why you're still appealing it. (CROSSTALK)

KING: The key to getting this out of the courts is to get Congress to act. But they couldn't get the Congress to act when they had a bigger majority, now you're going to have more Republicans in town. The question is could they do this in the so-called lame duck session after the election if Republicans win a lot of seats?

BELCHER: You're not going to get -- you're not going to get Congress to change this. I mean most major changes happen in our country for better or worse quite frankly has come through the courts. And you're not going to get Congress to change this. You're not.

(CROSSTALK)

KING: Despite those shifts in public opinion you see, you don't think Congress will change it?

BELCHER: No because despite those shifts in public opinion you still -- you're going to have a Congress that's arguably more harder right ideologically. You know, you're running guys out like Castle, who quite frankly are moderate. We should cross the aisle to. You're going to have a Congress that's worse now than it was.

KING: Ed Rollins --

(CROSSTALK)

KING: Ed Rollins, how would you advise a Republican member of the House or Senate if they said how should I vote on this?

ROLLINS: You know at the end of the day I don't think this is going to happen in a lame duck session. I think he'll wait until next year. See what the bill is introduced, see what the courts do. At this particular time, what Congress does is irrelevant. It's going to end up in the Supreme Court whether it's six months from now or four months from now.

It's going to happen because several other judges are going to rule one way or the other and it's going to have to come to the highest court in the land. So I'd say to Republicans stay out of it at this point in time. Don't get out in front of it. I also don't think a lame duck session that has so much stuff coming back to it after you -- you can intellectually talk about losing 40, 50, 60 seats, but when you actually do it and they come back and most of them have lost in close elections, they're not going to be anxious to do anything but go home for Christmas.

MARTIN: I'm used to weak politicians. What they'll simply do is say leave it to the court so we don't have to deal with it.

KING: Why do we have -- why do we have politicians then --

(CROSSTALK)

KING: We'll come back to that question. We'll come back to it. We're also going to keep our eye on the California court to see if there is any more legal action on this issue tonight.

But when we come back we switch focus to the election 14 days from now and Nevada's U.S. Senate race is one of the closest and one of the most important in the country. So why at times does it seem so pathetic?

(COMMERCIAL BREAK)

KING: On election night two weeks from now as we count the results from East Coast to West it is possible if Republicans are having a decent night that we could be looking at the Senate races in Nevada, in California, and in Washington State to figure out which party will control the Senate come January. That Nevada race features the man who currently leads the United States Senate, the Democrat and the Majority Leader Harry Reid.

He's running against the Republican nominee, Sharron Angle, who is a Tea Party favorite. They disagree on taxes. They disagree on health care. They disagree on Social Security and so much more. But in the past few days, the race has come down to essentially a big debate about what you might call off-beat or off-color or, frankly, not very bright comments. Here's Sharron Angle speaking to a group of Latino students last Friday.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: You know I don't know that all of you are Latino. Some of you look a little more Asian to me.

(END VIDEO CLIP)

KING: Now she's been ridiculed for that remark, saying some of you look a little more Asian to me, ridiculed in the press in Nevada, ridiculed by some of her critics. Today Senator Reid opened a big rally campaigning with his own ridicule.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER: As I look out over this crowd, I really don't know what my opponent was talking about because you all look like Nevadans to me.

(END VIDEO CLIP)

KING: Let's continue the conversation with Ed Rollins in New York, Cornell Belcher and Roland Martin with me here. Roland, you're laughing and some things in politics are funny. But are we going to wake up the day after the election, this race in particular, two candidates who disagree on just about everything, and this has come down to you're a bigger jerk than me or you're making more mistakes, gaffes than me. It's not a race that's terribly uplifting.

MARTIN: Well first of all, they've thrown everything at each other, but it's not surprising. When you look at what's happened in Kentucky, the same thing. I mean they won't even shake hands anymore. This is what happens when you have folks who are polar opposites. And so I think the most important thing right now, who care us bout a gaffe? Who cares about whether who is more (INAUDIBLE), who's outrageous? It's really boiled down to a ground game.

(CROSSTALK)

KING: If I were a voter in Nevada, I think I'd move to California.

BELCHER: But here's the thing. It's not a gaffe. I mean it's quintessential misunderstanding of sort of who the electorate is and in the states like Nevada and Colorado and New Mexico where this is a growing percentage of your population, you know, being able to connect with that -- with that group and understand that group is important. To me it is an election issue and by the way, you know Senator Reid didn't make this gaffe, but he took advantage of it and guess what, you all are Nevadans. I mean that is -- I mean that's sort of bringing together. She made this gaffe. He didn't make it.

KING: So he's holding her to account for this gaffe. I just want the record to be clear and Sharron Angle has made a long list of them. We could spend the rest of the program on them. However, however, her opponent, Harry Reid is not exactly perfect on this issue either. Here's just a few of Harry Reid's least greatest hits.

(BEGIN VIDEO CLIP)

REID: Today is a big day in America. Only 36,000 people lost their jobs today, which is really good.

I don't know how anyone of Hispanic heritage could be a Republican, OK? Do I need to say more?

Because the high humidity and how hot it gets here, you could literally smell the tourists coming into the Capitol.

(END VIDEO CLIP)

KING: Ed Rollins, what do you do at this point in an election when you have two candidates who are, shall we say, not out of the playbook?

ROLLINS: The oldest rule in politics is your pair of two's may not look like much in the poker game, but it beats one of a kind. And I think that's what this election comes down to. I think the critical thing here is Harry Reid has served for 24 years in the Senate seat. He's fighting for his life. I mean he's the majority leader of the Senate and he is fighting for his life against any candidate.

Angle wasn't the first choice of a lot of establishment Republicans. She's come back after having $20 million spent against her. And it's going to be late at night. One other race you left out is the Alaska race. We're going to be up all night long waiting for this race, which is going to be dead even going into the election. It's going to be the Alaska race, which has got some strange things happening up there. The state of Washington, California, my home state, former home state, we're going to have a long, hard night and whoever wins three out of four of those may very well be the majority --

KING: Some of us like long, late nights doing all the counting, so I'll be up, Ed will be up. Cornell and Roland will be up --

UNIDENTIFIED MALE: Ed doesn't like it --

(CROSSTALK)

KING: Oh Ed loves it. Ed loves it. If his guys have a chance, he loves it. Sharron Angle, she has said some not-so-bright things on the campaign trail, but her advertising, you might criticize her for being nasty, but she's tried to make points there essentially to say he's the incumbent to disqualify him because then a candidate who makes mistakes can win an election if people decide that we don't want the incumbent back. Watch this new ad from Sharron Angle.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE, POLITICAL AD: Not everyone in Nevada is suffering from Harry Reid's failed economic policies. While you may be in the unemployment line, someone is more likely to be in a conga line. And while your family is just hanging on, someone has been hanging out with supermodels.

(END VIDEO CLIP)

KING: All right (INAUDIBLE) -- it goes on to say Harry Reid has an apartment in the Ritz Carlton here in Washington, D.C. That was Jessica Simpson there if you couldn't see. I know Cornell you were leaning over to see -- who was in the shot. But let's go back to something else --

(CROSSTALK)

KING: Let's go back to that picture of Harry Reid in the alleged conga line. Can we go back to that on TV here? Now that's Harry Reid in the alleged -- in the ad they said the conga line. OK, that's Harry Reid, double high five there. You see those hands in the picture -- a conga line -- not exactly.

Can we show the real picture where that came from. That's Harry Reid with Michelle Obama. They flipped the picture. This is at an event celebrating Mrs. Obama's fitness initiative to get kids outside, to get kids to exercise every day, to get kids to eat better -- what they did in that ad is they flipped the picture and mysteriously, Cornell, they took out except for the hands, the face of probably the most popular female political figure in America.

BELCHER: Right. No, but this is why Americans you know don't trust politics because it is this sort of thing goes on. And you know, and Ed knows it goes on, on both sides. And I know you're going to chime in and say it goes on both sides. But it happens too often and that's why Americans don't trust politics. I mean that's a perfect example.

KING: Ed, do they think we're stupid and (INAUDIBLE) I give (INAUDIBLE) our staff the research, she gets the research credit for this one. Do they think that we're stupid and we're not going to find these things?

ROLLINS: No, they don't think you're stupid, but they assume that in Nevada, that that commercial will probably have more of an impact and for the number of people that are watching this show, which hopefully is more and more every day, you know, at the end of the day, it's -- it's the -- how many times they pound that home through.

And if he has to stand up and say, no, no, it's not -- I'm not in a conga line. I'm basically with Michelle Obama. He's raising the issue of conga line one more time. So I think the key thing here is the advertising is more expensive than ever, more of it being done, and more negative probably than ever across this country. And I've been in this game for a long, long time. I've never quite seen anything like it and I think that was a pretty good ad. I think it might work.

MARTIN: Well first of all saying that Harry Reid should say hey, conga line, Latino voters, come on down. Let's conga to the polls.

(LAUGHTER)

KING: Ed, Roland, Cornell, thanks. I'm going to conga over here for a minute to give you a sense of what's coming up in the rest of the program.

When we come back, we'll go "One-on-One" with one of the most important voices in our politics right now, the president's top political adviser, David Axelrod. What is the White House end game for the final two weeks? You won't want to miss that.

Also when we come back, dire warnings, the GOP is through? We'll see about that one.

And we talk politics tonight, the sequel, Arnold? He's not on the ballot this year. What are we talking about here?

And why is Bill Clinton so loyal to one guy down in Florida? We'll break it down.

(COMMERCIAL BREAK)

KING: Welcome back. Let's check in with Joe Johns for the latest political news you need to know right now -- Joe.

JOE JOHNS, CNN SENIOR CORRESPONDENT: John, borrowing money from China just got more expensive. Its Central Bank today announced its first increase in interest rates in nearly three years sparking sell- offs on world stock markets. The Dow Jones Industrials lost 165 points, closing below 11,000 for the first time in a week.

CNN has learned a just completed CIA review discovered U.S. and Jordanian intelligence officials raised concerns about a promising informant in Afghanistan, but the warnings were not passed on before the man detonated a suicide bomb last December killing 10 CIA employees and contractors.

Former Defense Secretary Donald Rumsfeld's days of keeping a low profile are over. He has a new book coming out in just a few months and now he has just surfaced on Twitter. John, I also hear he's on Facebook as well. And you know, it's really interesting too, because this is a guy who has a lot of PR work to do.

KING: Hugh Shelton, yes that's what you want -- we should tweet Rummy, let's tweet Rummy (INAUDIBLE) and see if he'll respond. I don't know. You know, Twitter is one place, you mentioned Facebook. A lot of politicians and public figures more and more, even older generation are getting involved in the social media. Let me show you just the top five, top five members of Congress in adding fans, we call them, for the political sites on Facebook.

These are the top five additions just in the past week. Now you could go and look at Facebook you'll find congressmen and women with more fans. Michele Bachmann, conservative from Minnesota, a big Tea Party favorite. She's added more than 2,200 fans again just in the last week. That's a high. Gabby Giffords, she's a Democratic incumbent, a tough race in District 8, Congressional District 8 in Arizona just south of Phoenix. She's added 218 fans in the past week.

That puts her in the top five. Jon Runyan, a Republican candidate for Congress in New Jersey, 260 fans on Facebook in just the last week. Allen West, African-American Republican candidate running a tight congressional race down in Florida District 22. He's added nearly 500 fans in the last week and another outspoken Florida politician, Democrat Alan Grayson, 259 fans in the past week.

And one of the ways -- one of the reasons we look at this, Joe, we talked about looking at polling for intensity gaps. We've learned by looking through the primary campaigns that if you see a lot of activity on these Web sites, it does tend to give you some indication of the energy behind the campaign. You can't tell for certain. It's not scientific, but it's a way to keep track of enthusiasm, energy.

JOHNS: Some of these guys got a lot of bad publicity the last couple of weeks.

KING: Do you think that's what started it? Sometimes you have bad publicity. You gain -- you lose a friend, you gain a friend. Who knows, that's how it goes in politics.

All right, when we come back we'll keep on politics. President Obama heads west tomorrow to campaign for several endangered Democrats. One of the president's top political advisers, David Axelrod, right here to talk about the White House strategy for the final two weeks until Election Day.

(COMMERCIAL BREAK)

KING: With just two weeks until the midterm elections, President Obama is turning to radio and TV to get his message out, and there will be plenty of presidential traveling. Here to talk about the election end game from the White House perspective is the president's top political adviser, the senior White House adviser David Axelrod.

What will you be looking for as someone who knows the country quite well? Here's what I say. I'll look on election night see if Deval Patrick can win reelection in Massachusetts, if the Republicans come back and win that race it will tell me that Republicans are in for a big night coast-to-coast. What will David Axelrod be looking for as the first results come in from the East Coast states?

AXELROD: Well of course I'll be watching that race as well because Deval is an old client of mine. I think he's a spectacular person and a great governor. Massachusetts, though, had elected Republican governors for 16 years before he arrived, so it's a competitive -- it's a competitive race here. But I am going to be looking at that race in Pennsylvania as a -- as an East Coast harbinger of the kind of night it's going to be. And, you know, as we move west, we'll be looking at -- at some of the places the president has visited. The Ohio governor's race is a really interesting race. I think that Governor Strickland has rallied and is running a great campaign there. We'll be eager to see that.

KING: If Joe Sestak loses in Pennsylvania and Ted Strickland loses in Ohio, will you climb under the desk?

AXELROD: No. I think you'll see an election where, you know, people win who perhaps you didn't expect to win. People lose who perhaps you didn't expect to lose on both sides. So, I mean, what I would suggest to you, is you stay up for the full night and total it up at the end. You know, we -- if, for example, Jerry Brown can withstand, you know, what will probably end up being $20 million of spending by his opponent, get elected governor of California, that will be a big victory in the nation's largest state. If Alex Sink down in Florida can win, and she's leading right now, win the governorship of Florida, that will be a big victory. I think it's going to be a more interesting night than perhaps some.

KING: One of the things the president is trying to do and you're trying to do is to get excitement and turnout among African-American voters. The president is on the radio, he's done a number of events including a couple with Michelle Obama, the first lady. I want you to listen to Cornell Belcher, who helped elect this president in 2008. He had some concerns. He says it's great to turn out African- Americans now. His question was where has the leadership been the past 20 months. Listen.

CORNELL BELCHER, CNN CONTRIBUTOR: I'm going to go rogue for a moment here on my party, as I do from time to time. Look, we've done a fairly poor job of engaging our base. The problem we're going to have to fix down the line. We've got to grow more diverse inside that room, that strategic room of the Democratic Party to engage these voters. We have not done that, and we may pay the price for it.

KING: It sounds almost odd that he's making the point that under our first African-American in his view, there are not enough people of color and diversity making the key political decisions. Is he right?

AXELROD: I don't know. Cornell's been deeply involved in helping us with our strategy. I have a great amount of confidence in him. He's made a great contribution. But, look, we've been trying to deal with some epic economic problems in this country over the last 20 months. And many of them have visited minority communities with a greater vengeance than anywhere else. And that's been our first order of business. We haven't been simply running for office. We've been trying to move this country and get it out of the ditch that it's been in. A lot of the things we've done, whether it's education reform or -- or college assistance or health reform or some of the initiatives to spur small business lending in communities that were hard-hit, all of these things are going to have an impact in -- in minority communities and all our communities. And so our focus, I think, has properly been on trying to deal with the problems that are plaguing people in their lives. I wish we had more time and been able to expend more effort campaigning around the country, but that's not what people elected us to do in a time of crisis. We fulfilled our obligations and our responsibilities.

KING: A man who served in the white house under George W. Bush, Michael Gerson, wrote a piece in the "Washington Post" today under the headline "Obama the Snob." He used the quote from the president recently in Massachusetts where the president said, "Part of our politics seem so tough right now and facts and science in argument do not seem to be winning the day all the time is because we're hard- wired not to always think clearly and we are scared and the country is scared.: He went on to make the case that that was arrogant, that the president was saying that people out there who think Washington is spending too much money or people that think the president should have focused on jobs from the get-go and not health care that it was an insult to them. Do you see it that way? Is the president a snob?

AXELROD: No, I think the president was stating which is obvious, that this has been a very tough time. The policies that Mr. Gerson worked so hard to put in place in the Bush administration created on economic disaster that we haven't seen since the great depression, and we've been about the business of trying to deal with the aftermath of that.

KING: You've been at the president's side throughout the campaign and now the last 20 months in governing. Peter Baker of the "New York Times" wrote a Sunday magazine piece about the education of the president. He said, "Some white house aides who are ready to carve a new spot on Mt. Rushmore for their boss two years ago privately concede that he cannot be another Abraham Lincoln after all. In this environment, they have increasingly concluded, it may be that every modern president is going to be, at best, average." Have you lost your idealism, David Axelrod? Are you one of those people?

AXELROD: Not in the least. Not in the least. First of all, let me say I never had my chisel out to carve his image in Mt. Rushmore. I had realistic expectations. I do have great admiration for the president. He's provided strong leadership in a very difficult time. He's working very hard to solve problems that he -- that he walked into that have plagued this country for some time. And -- and so, you know -- but, you know, my feeling is that it is a great privilege to be here and try and deal with those problems and fight your way through some of the noise of this town to get it done, but I still believe that each day.

Look, I give you the one example, John. I have a child with a chronic condition. My family almost went broke because of her medical condition and the bills we couldn't pay because the insurance company wouldn't pay for them. And on the night that we passed that health bill, I realized that families with kids with preexisting conditions wouldn't have to go through what I went through. It's hard not to feel good about that. And there are many, many examples like that. So, you know, there's a lot of noise. There's a lot of activity now, political activity. There's a lot of back-and-forth. At the end of the day, that's what this is about and that's why we do the work.

KING: Do you see the next two years as a series of vetoes and confrontation or will all this rhetoric pass and that there will be some effort at genuine compromise?

AXELROD: That remains to be seen. We're certainly going to make that effort. We want to work with anyone who wants to work with us to solve the problems of this country. You know, the hope is that with more members, I believe we'll retain control, but there will be more Republicans here. Everybody acknowledges that. With more members will come a greater sense of responsibility. They've sat out the last couple of years, trying to score political points instead of working with us to solve problems. We hope to work together in the future. It remains to be seen. But that's our goal. That's what we're going to pursue.

KING: David Axelrod, you're a very busy man. Appreciate your time.

AXELROD: Thank you, John.

KING: The voters are hearing plenty from Democrats and Republicans, but how about the rent is too blank high party? They just got their highest profile boost ever.

(COMMERCIAL BREAK)

KING: Welcome back. Let's check in with Joe Johns again for the latest news you need to know right now.

JOE JOHNS, CNN CORRESPONDENT: John, a university spokesman tells CNN Justice Clarence Thomas' wife tried to contact law professor Anita Hill who accused Thomas of sexual harassment during his confirmation hearings in 1991. The "New York Times" and ABC News report Virginia Thomas left a voicemail asking Hill to apologize and explained why she made the accusation. The message has been passed on to the FBI.

And Sarah Palin tweeted an endorsement for Republican U.S. Senate candidate John Raese, but she got the wrong state. Palin's tweet said Pennsylvania. He's running in West Virginia. She has corrected her mistake. You know what? It just seems like West Virginia gets no respect in this midterm election.

KING: It's next to Pennsylvania.

JOHNS: Yeah. Well, close enough, I guess. They wouldn't mix it up with Ohio.

KING: We pick on Governor Palin for that mistake. It was a mistake. I just want to note that making mistakes is a bipartisan affliction. This is an e-mail we all got today from the Democratic National Committee talking about president's big rally on the west coast. It's dated today. I think we can show it on the screen. It says, "With critical midterm elections just three weeks away." I want you to show up on November 9th and try to vote and see what happens. The elections are two weeks away, not three weeks away. You'd think if there's one thing the Democratic Party would know when the election is happening. We all make mistakes.

JOHNS: That's embarrassing. 220

KING: The election is two weeks away, ladies and gentlemen. Two weeks away. The Democratic National Committee, that's one of the tools the president has at his disposal heading into Election Day. When you're the executive brand and you control the government, you have a lot of tools at your disposal, including your staff. I want to show you something. Austan Goolsbee is the president's top economic advisor. The chairman of the council of economic advisory and he did a video today trying to set the record straight and defend the stimulus program, the recovery act. The lines are drawn. He's talking about job losses, the recession began here, job losses during the Bush administration. This is the economy during the Obama administration. Let's listen for a bit. Go on, Austin. Why doesn't he want to play?

AUSTIN GOOLSBY: Obviously we need to do more. But it has been quite a hole that we've had to crawl out of, the worst since 1929. And now we've started to hear some people say that we literally should go back to the policies that got us into this. And I think if you look at the last --

KING: All right. So he stops there. He shows up the arrow. Look at the end of this. Pay attention to this. At the end, you see job growth, the last few months of the Obama administration. Nothing wrong with that. That's a fair picture, sort of. Let's show you the entire picture and I'll explain the difference. If you look at this graph here, you'll see actually the last couple of months, jobs are down. This is the overall economy. This includes government jobs and private-sector jobs. Because the stimulus money has dried up, because governments have had to lay off workers, because the census workers have been laid off, the economy has lost jobs. He's focusing on the bright side of the equation, just private-sector job gains and losses. He's taking a piece of the data that makes their case and highlighting it here about the private sector. If you look at the total picture, you see it's a bit more negative. Nothing wrong with what he's doing here. This is just the total picture of the economy, which has gone down when you count government jobs. Go to our website. You can get the link to this entire presentation. Nice to hear what their saying.

And when we come back, a candidate from a political party you've probably never heard of just made a big splash. Will it get him any votes? Lower rent? We'll be right back.

(COMMERCIAL BREAK)

KING: Two weeks to Election Day. You might expect a busy and dramatic day on the campaign trail coast to coast. Let's check in with our reporters. Our national political correspondent Jessica Yellin is in Columbus, Ohio. Our senior Congressional correspondent Dana Bash up in New York. I want to start with an ad that now will not run on television but was going to run on television out in Nevada. Harry Reid's big Senate race out there. Latino turnout is critical. There's a conservative organization who wanted to run an ad on Univision. Univision has taken the ad and refused to run it. It was in Spanish, but we'll play English version for our viewers. Then we'll talk about it. Listen to this.

UNIDENTIFIED MALE: Democratic leaders must pay for their broken promises and betrayals. If we just go on supporting them again this November, they'll keep playing games with our future and taking our vote for granted. Don't vote this November. This is the only way to send them a clear message.

KING: Dana Bash, you're reporting on this today, including talking to the Republican activists who wanted to run this. But before the question I mean it's just reprehensible. It is reprehensible to urge people to not vote.

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: That is exactly what Harry Reid said today. It is exactly why he is pressing Sharron Angle to say, you know, are you going to denounce this or not, which she really hasn't done. This is an ad that this Latino group put up, very conservative Latino group. I talked to them today who was very blunt and said that he believes that the Obama administration and the Democrats who run Congress have not kept their promises and that the best thing for Latinos to do around the country is to register their frustration by just not voting at all. He is a conservative. That is important to underscore through and through. But obviously, the network he was wanting to run this on, Univision, said huh-uh, no way. We're not going to run this.

KING: Univision has run a good public service campaign urging people to exercise their Democratic right to vote, to seize more political power. Jessica Yellin, have you ever heard anything like this? I understand they can't in Nevada embrace Sharron Angle because the Latino community doesn't like her, but to tell people not to vote, it's mind-boggling.

JESSICA YELLIN, CNN NATIONAL POLITICAL CORRESPONDENT: Well, it actually sounded like a classic voter suppression strategy. We've heard stories throughout history of efforts to go into minority communities and convince people not to vote because the power structure doesn't have your best interest at heart. Of course, we believe in this country voting is the way to express your voting is the way to express your views. You can't help but recognize that Latino voters, not uniformly, but they tend to break more Democratic than Republican. It would be an effort to suppress the Democratic vote in a state where Harry Reid is counting on that if he has any chance of winning John.

KING: Here is my favorite new ad of the day. Jess broke word of this this morning. It is a Jerry Brown campaign trying to tie his Republican opponent Meg Whitman to a very unpopular Republican governor.

ARNOLD SCHWARZENEGGER: It is all about leadership.

MEG WHITMAN: It's all about leadership.

Jobs, jobs, jobs.

SCHWARZENEGGER: Jobs, jobs, jobs.

We do not have a revenue problem.

WHITMAN: We do not have a revenue problem.

SCHWARZENEGGER: We have a spending problem.

WHITMAN: We have a spending problem.

SCHWARZENEGGER: What's the worst thing that can happen?

WHITMAN: What's the worst that can happen?

KING: I think you get the picture there. Why Jess do the Jerry Brown people think trying to link her to Schwarzenegger will work?

YELLIN: Because Meg Whitman has sold herself as a nonpolitician, a businesswoman who will come in from the outside and clean up government using her business know-how. It is the exact same message Arnold Schwarzenegger used when he ran for office. He was swept in with a lot of excitement. He's wildly unpopular with voters. They think his governorship has been a failure. His approval rating 23 percent in the latest polling. Meg Whitman has done everything she can to distance herself from Schwarzenegger, criticizing him endlessly. This is their effort to say, you didn't like him, you won't like her.

BASH: And on that point John, with the statement Jessica earlier today got from Meg Whitman's campaign responding to the ad was just unbelievable. It said not necessarily about Jerry Brown but about the current governor, Arnold Schwarzenegger. It talks about him as an actor and making it equivalent that he is an actor and she's somebody who is very successful in the business world. That is not something you should do. This statement divulged for mayor with regard to how she feels publicly about Arnold Schwarzenegger was really stunning.

KING: Nobody likes Arnold Schwarzenegger in the governor's race. Sorry, governor. We'll have you here any time you want to see what you think of the ads and the candidates.

When we come back, Pete Dominick joins the conversation, more politics including an interesting Delaware Senate debate today.

KING: Loyal guy, OK. Bill Clinton down campaigning in the state of Florida today for Kendrick Meek. Kendrick Meek is running third in a three-way race for Senate down there and a lot of Democrats have been wishing Kendrick get out of the race. Then Charlie Crist the independent might win. Can he come support us? A lot of Democrats wish that would happen. They won't quite say it openly because you have a prominent African-American candidate running there in Florida. This is Bill Clinton's third appearance for Kendrick Meek. We say a lot about Bill Clinton. Sometimes we say all politics is local. This one is personal. Kendrick Meek is the son of Carrie Meek. Carrie Meek was the Congresswoman who held the seat before her son. Remember Monica Lewinsky, Pete?

DOMINICK: No. Familiarize her with me.

KING: Never mind. She was the subject of a rather divisive impeachment battle here in the United States. This is Carrie Meek.

REP. CARRIE MEEK (D), FLORIDA: Mr. Speaker, the bible say he without sin cast the first stone. Let me tell you, in this chamber is full of sinners. I am here on behalf of my constituents who want the president to know they love him and they are praying for him and the country.

DOMINICK: That's true. The other important thing is there that you didn't mention is there are no black senators. For the Democrats to abandon the one guy that's got a chance would look horrific. Loyalty is a good point. Thanks for bringing us back there. That's the other point.

KING: It would look horrific. I'm sure he's not glad I brought you back there. It would look horrific. You're absolutely right. If that talk ever gained steam, Bill Clinton's the guy who would say, not me, not there. Let's move on. There was a debate in Delaware today, a race we have been following. Christine O'Donnell versus Democrat Chris Coons. This is Christine O'Donnell answering -- there were several questions about what is this amendment in the constitution, what does that amendment mean. Here's Christine O'Donnell.

CHRISTINE O'DONNELL (R), DELAWARE SENATE CANDIDATE: I'm sorry. I didn't bring my constitution with me. Fortunately, senators don't have to memorize the constitution. Can you remind me of what the other ones are?

UNIDENTIFIED MALE: 14th amendment defines citizenship.

O'DONNELL: Oh.

UNIDENTIFIED MALE: And the 16th amendment -- I think you should know what the 16th amendment is. Federal income tax?

O'DONNELL: Okay.

KING: Now, look, I don't have my constitution exactly memorized. I do know most of the amendments I think. What's interesting to some is that at a previous forum Christine O'Donnell said this.

UNIDENTIFIED FEMALE: What responsibilities or experiences in jobs and past activities do you feel qualify you to be a senator?

O'DONNELL: Well, for one, I have a graduate fellowship from the Claremont Institute in constitutional government. It is that deep analysis of the constitution that has helped me analyze and have an opinion on what's going on today.

KING: I think we can end that there. Is it fair? Since she said the first Jessica Yellin to contrast with the answers from today's debate?

YELLIN: John, it's not only fair, it's necessary. I think -- you know, I have been on the campaign trail for a while watching a lot of people speak. I have to say there was a phrase President Bush used to use. The soft bigotry of low expectations. He was using it with reference to minority kids in schools. I think it applies to women in politics. It's important that people in the media hold women in politics to the same standards we hold men. It doesn't matter how angry they get at us and whether they say we have a liberal bias or conservative bias for going after them. If a man did that, a guy who holds up the constitution and says, I live by this, my opponents don't or anything which is what the tea party candidates do so often, she's endorsed by the tea party express, we would hold her feet to the fire. I think we are obliged to in this case.

KING: All right. Let me sneak one more in here because I love this one. Seven-way debate in the New York governor's race last night. Ladies and gentlemen, meet Jimmy McMillan.

JIMMY MCMILLAN: Allow me to introduce myself. I represent the rent is to damn high party. People working eight hours a day and 40 hours a week and some a third job.

KING: Hard to argue with that right Dana. Isn't the rent too high?

BASH: It's definitely too high. We have relatives who live here. We know friends who live here. It is too high. He was behind the 8 ball. There was a musical in the 1990s about it.

KING: How's your rent, Pete?

DOMINICK: I own now but I lived in New York for 15 years. I am a New Yorker. I'm voting for that guy. I'm going to look up his name and just based on his appearance alone, I love him.

KING: All right. We're out of time. "PARKER SPITZER" starts right now.